Europe's Instex is a failed attempt at appeasing Iranian regime

By

Struan Stevenson

U.S. Vice President Mike Pence (L) speaks with Polish President Andrzej Duda at a welcome dinner prior to his participation in a summit in Warsaw, Poland, on Wednesday. Photo courtesy of the U.S. State Department/Flickr

Feb. 15 (UPI) -- While foreign ministers and senior officials from 60 nations met in Warsaw, Poland, with U.S. Vice President Mike Pence and Secretary of State Mike Pompeo to discuss Iran's oppressive regime and malign influence in the Middle East, Europe's front-line appeasers are trying desperately to rescue their flagship sanctions-busting policy.

On Jan. 31 , the foreign secretaries of France, Germany and the United Kingdom shamefully announced a deal to help companies that wish to continue trading with Iran to avoid American sanctions. The deal was referred to as an Instrument in Support of Trade Exchanges and was designed to allow European Union businesses to bypass dealing directly with Iran, by operating a kind of barter system. According to the three foreign ministers, exports to and imports from Iran would be channeled through Instex, neatly side-stepping the U.S. sanctions.

Following America's withdrawal from former President Barack Obama's failed nuclear deal with Iran in 2015, President Donald Trump reintroduced sanctions against Iran, accusing it of cheating on the terms of the deal, oppressing its own citizens and waging proxy wars throughout the Middle East. The EU's High Representative for Foreign Affairs, Federica Mogherini, a frequent visitor to Tehran, pledged to do everything possible to find ways of skirting the U.S. sanctions. Ignoring nationwide protests inside Iran against the theocratic dictatorship, Mogherini signaled the EU's preference for lucrative commercial contracts, rather than unmasking crimes against humanity. The arch-appeasers in the governments of France, Germany and the United Kingdom, whose lust for blood-soaked dollars apparently outweighed their desire for human rights, were quick to offer support. Instex was the result.

Dictionaries describe appeasement as the diplomatic policy of making political or material concessions to an aggressive power in order to avoid conflict. Historically, it has usually ended in disaster, as the failure of Neville Chamberlain's attempts to appease Adolf Hitler can attest. Instex now seems destined to meet the same fate as Chamberlain's infamous "peace in our time." To the great disappointment of the EU, the launch of Instex got off to a bad start, attracting very little media coverage, with some journalists even asking why it had been created in the first place and what was the point of it. Other press reports highlighted a spate of recent attempted assassinations, bomb plots and terrorist actions on European soil, involving Iranian Ministry of Intelligence agents, some even posing as diplomats. Kissing, cuddling and giving gifts to the mullahs seemed incomprehensible in such circumstances, some newspapers opined.

But the progress of Instex has been far from smooth. The Trump administration has warned Europe not to get involved in sanctions-busting with Iran. The United States is keeping a close watch on developments, pointing out that any company that seeks to earn $1 in Iran could risk losing $1 million in America. The warnings have had an impact. Most EU member states declined to provide Instex with a base for its headquarters, frightened that they would attract the wrath of the U.S. government.

Finally, France stepped into the breach, offering Paris as the Instex base. But its troubles did not end there; ludicrously, Instex can only focus on trade that involves goods that are not covered by the U.S. sanctions, like foodstuffs and medicines, giving rise to questions about what is the point of providing a vehicle for trading in these goods? Instex cannot get involved in trading in oil, Iran's main export, which has witnessed plummeting returns since U.S. sanctions were reintroduced. Oil exports, which were previously at 2.5 million barrels per day, have plunged to less than 1 million bpd, crippling the Iranian economy.

France, Germany and the United Kingdom have also said that Instex will operate to the "highest international standards with regards to anti-money laundering, combating the financing of terrorism and EU and U.N. sanctions compliance." This infers that Iran will need to comply with the Financial Action Task Force -- an international body it are currently suspended from, making it difficult for Iran to fulfill the terms of the agreement. Indeed, the final nail may have been driven into the Instex coffin by the Iranians themselves. Last week, the head of the Iranian judiciary, Sadeq Larijani, said that the clerical regime could never accept the Instex proposals because it would involve it in accepting the FATF conventions and ending its ballistic missile program. Larijani called these "insulting conditions."

Meanwhile, Hossein Shariatmadari, editor-in-chief of Keyhan daily, a newspaper known as the mouthpiece of Iran's supreme leader Ali Khamenei, stated in a major article: "The most humiliating aspect of Instex is that in return for our oil income we are only permitted to purchase food and medicine. This is exactly the same oil-for-food plan that the U.S. and Europe imposed after defeating Saddam Hussein in his attack on Kuwait. As if we are a defeated and surrendered country, or an orphan or small child that the Europeans must look after us. Those minority members of the Expediency Council must now, without a doubt, vote no to the FATF."

So, while thousands of Iranian supporters of opposition MEK and the National Council of Resistance of Iran, under the leadership of Maryam Rajavi, held a rally and march in Warsaw this week, chanting "Appeasement no; regime change yes" to coincide with the summit on the Middle East, Instex seemed, like Chamberlain's piece of paper, to be destined for the trash can; another failed attempt at appeasement.

Struan Stevenson is the coordinator of the Campaign for Iran Change. He was a member of the European Parliament representing Scotland (1999-2014), president of the Parliament's Delegation for Relations with Iraq (2009-14) and chairman of the Friends of a Free Iran Intergroup (2004-14). He is an international lecturer on the Middle East and president of the European Iraqi Freedom Association.